Correlation Between BROADWIND ENRGY and Gentex
Can any of the company-specific risk be diversified away by investing in both BROADWIND ENRGY and Gentex at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining BROADWIND ENRGY and Gentex into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BROADWIND ENRGY and Gentex, you can compare the effects of market volatilities on BROADWIND ENRGY and Gentex and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in BROADWIND ENRGY with a short position of Gentex. Check out your portfolio center. Please also check ongoing floating volatility patterns of BROADWIND ENRGY and Gentex.
Diversification Opportunities for BROADWIND ENRGY and Gentex
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between BROADWIND and Gentex is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding BROADWIND ENRGY and Gentex in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gentex and BROADWIND ENRGY is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on BROADWIND ENRGY are associated (or correlated) with Gentex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gentex has no effect on the direction of BROADWIND ENRGY i.e., BROADWIND ENRGY and Gentex go up and down completely randomly.
Pair Corralation between BROADWIND ENRGY and Gentex
Assuming the 90 days trading horizon BROADWIND ENRGY is expected to under-perform the Gentex. In addition to that, BROADWIND ENRGY is 3.35 times more volatile than Gentex. It trades about -0.02 of its total potential returns per unit of risk. Gentex is currently generating about 0.01 per unit of volatility. If you would invest 2,533 in Gentex on October 12, 2024 and sell it today you would earn a total of 127.00 from holding Gentex or generate 5.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BROADWIND ENRGY vs. Gentex
Performance |
| Timeline |
| BROADWIND ENRGY |
| Gentex |
BROADWIND ENRGY and Gentex Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BROADWIND ENRGY and Gentex
The main advantage of trading using opposite BROADWIND ENRGY and Gentex positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BROADWIND ENRGY position performs unexpectedly, Gentex can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Gentex will offset losses from the drop in Gentex's long position.| BROADWIND ENRGY vs. Apple Inc | BROADWIND ENRGY vs. Apple Inc | BROADWIND ENRGY vs. Apple Inc | BROADWIND ENRGY vs. Apple Inc |
| Gentex vs. Gladstone Investment | Gentex vs. Air Transport Services | Gentex vs. ECHO INVESTMENT ZY | Gentex vs. BROADWIND ENRGY |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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